Staking is an effective strategy for generating passive income on cryptocurrency. This is the case of Tao, the native token of Bittensor that it is possible to place in stations to contribute to the operation of its network and thus perceive a return. Find out how to do Tao Stoking on the Bittensor network.
What is Bittensor?
Bittensor is a decentralized network that works as a marketplace of specialized digital resources called “digital conveniences”, which can be used by artificial intelligence (IA) products. These digital amenities are produced by subnets called “subnets”, each specialized in a specific field such as text generation, automatic translation, financial forecasts, etc.
Being open to everyone, the Bittensor network wishes to create a kind of central brain or each participant contributes to the development of collective intelligence.
Bittensor has a native cryptocurrency named TAO which is used to contribute to the governance of the protocol, pay the transaction costs or even ensure the performance of producers of digital conveniences through a stuking mechanism.
👉 Stoker his Tao on Mind Mandate
Why place your Tao in Stuking?
Within the Bittensor network, the Token Tao occupies a central place, in particular thanks to its stuking mechanism. By being staked, the TAOs actively participate in the proper functioning of the production of digital conveniences while determining the distribution of new programs by the Bittensor network.
Indeed, the Bittensor network is made up of validators who guarantee TAOs in order to verify the quality and integrity of the digital conveniences produced by the minors of the subnets. In exchange, validators are paid in TAO for their contribution to the network.
In order to increase the quality of the network, Bittensor offers the possibility to all Tao holders to delegate their tokens to a validator. In this way, they also participate in the proper functioning of the network and therefore receive passive income proportional to their quantity of Tao delegated tokens. At the time of writing these lines (February 10, 2025), The yield on Tao Stoking on Bittensor can bring up to 20 % annualized.
Tao Staking is non-custodial, which means that no centralized intermediate is involved and that it is possible to delegate tokens directly from a crypto wallet taking charge of the Bittensor network.
In addition, unlike the majority of delegation mechanisms, when you delegate TAOs on the Bittensor network, you only delegate your right to vote (representative of your quantity of TAO), and not directly your Tao tokens. This means that your TAO remains in your wallet during the delegation, which eliminates the risks of hacks linked to smart contracts.
Last point to take into account, when a user stakes his tao, a period of 1h20 is applied before he can withdraw them. Once this period has passed, the user can withdraw his stuking Tao at any time.
👉 Stoker his Tao on Mind Mandate
What options to delegate your TAO?
On Bittensor, it is possible to delegate your Tao tokens in 2 ways: directly from a wallet or using a “delegation manager”.
Delegate Tao from a wallet
To delegate TAO directly from a Wallet, you must have your tokens on a wallet taking charge of the Bittensor network as Bittensor Wallet, supplied with a minimum of 0.1 TAO. Indeed, on the Bittensor network, the minimum amount of TAO required to be able to delegate is 0.1 per validator.
Here are the steps to delegate your Tao on the Bittensor Wallet:
- Click on ” Stake »On the Bittensor Wallet;
- Select a validator from the proposed list then click the ” Stake »;
- Find out the amount of TAO you want to delegate and then click on ” Continuous »;
- Confirm with the password of your Bittensor Wallet;
- Check the summary of your transaction then click on ” Stake ».
You have delegated your TAOs to the Bittensor network successfully!
Delegate TAOs via a Delegation Manager
A delegation manager is a platform that is responsible for redirecting the delegation power of users to the most efficient Bittensor validators in order to maximize their performance.
By delegating his TAO to a delegation manager, the user does not have to worry about the selection of the validator and is guaranteed to obtain a competitive and without interruption return.
To delegate Tao to a delegation manager, you must first have a wallet compatible with Bittensor, like Bittensor Wallet.
Here's how to delegate your TAO to Minds mentat, a delegation manager recognized on the Bittensor network (2 TAO minimum required):
- Visit the Minds Mentat website then connect your Bittensor Wallet;
- Click on ” Delegation approval ».
Note however that by following these steps, all of the TAOs present on your wallet will be delegated. In addition, if you send TAOs to the address of this Wallet, they will be automatically delegated in the coming days.
If you want to delegate only part of your TAO, create a new address dedicated to Mind Mandes and then send it to the quantity of TAO you wish to delegate.
Where does the yield generated by Tao Staking come from?
The yield generated by Tao Staking comes from the remuneration of validators which perform essential tasks for the Bittensor network.
Unlike other blockchains like Ethereum, Bittensor validators do not validate network transactions. Their role is rather to assess the work carried out by minors within the subnets.
Each validator attributes a note to a minor according to the quality of his work. A consensus is then formed from these notes, where the weight of each note is balanced by the quantity of Tao stakes by the validator. The more the note awarded by a validator is close to the consensus, the more it receives better remuneration.
To perceive an attractive return via Tao Staking, it is therefore essential to delegate your tokens to a powerful validator, which correctly assesses the work of minors.
Tao Staking after the Dynamic Tao update
Soon, Bittensor plans an important update of its network called Dynamic Tao. The purpose of this update is to give users the power to redirect Tao emissions to the subnets.
In other words, when this update is deployed, users will have to delegate their TAO to a subnet. Thus, the more a subnet will have a large part of the TAO in stations, the more it will obtain a large proportion of the new TAO issued.
Thus, by delegating their TAO to a subnet, users will expose themselves directly to its performance, which will require a good knowledge of the Bittensor network. Even when the Dynamic Tao update will be effective, it will always be possible to delegate your Tao tokens yourself directly from your Wallet.
Thus, for those wishing to optimize their performance, the option of going through a delegation manager as a Mind Minds remains relevant, because it takes care of delegating the Tao to the most efficient subnets.
👉 Stoker his Tao on Mind Mandate
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Investments in cryptocurrencies are risky. There is no guaranteed high yield, a product with high performance potential implies a high risk. This risk taking must be in line with your project, your investment horizon and your ability to lose part of this savings. Do not invest if you are not ready to lose all or part of your capital
Coming from studies in computer science and passionate about the universe of the web 3 since 2020, I jointly put my skills to popularize technical concepts and help readers better understand blockchain and its ecosystem.
